Volkswagen, PowerCo and Gotion form three joint ventures for LFP battery cells

Volkswagen, PowerCo and Gotion form three joint ventures for LFP battery cells

28 September 2026: Volkswagen Group, its battery company PowerCo SE and the Chinese cell maker Gotion High-tech have agreed to set up three joint ventures for industrial production of lithium iron phosphate (LFP) battery cells and cathode active material, with joint procurement and sales in Europe. Two of the ventures take over existing or half-built factories, in Valencia and Surany, and the third is a planned cathode plant in Morocco.

Valencia: PowerCo keeps the majority

The PowerCo gigafactory under construction in Valencia, Spain, will move into a joint venture in which PowerCo holds 51% and Gotion 49%. The two partners will manage it jointly, and the goal is a European production hub for LFP-based Unified Cells. Planned investments and job creation at the site remain as announced. Gotion will invest about EUR 1.1 billion for its 49% stake, an amount the release links to the scale and strategic importance of the site.

Surany and Kenitra: Gotion takes the lead

Gotion's existing cell factory in Surany, Slovakia, moves into a joint venture in which Gotion holds 51%. It makes LFP cells for electric vehicles and energy storage. The third venture is a planned new LFP cathode material plant in Kenitra, Morocco, where Gotion also holds 51% and both partners will manage the business. The release says the plant is meant to diversify sources of key cathode active materials, improve supply security and expand the regional value chain.

PowerCo expects to contribute about EUR 470 million by 2030 to Surany and Kenitra for its 49% stakes in them.

What has to happen before closing

Closing needs regulatory approvals, customary conditions and approval by Gotion's shareholders' meeting. Alongside the joint ventures, Volkswagen (China) Investment Co. signed definitive agreements to sell a 5.3% equity stake in Gotion, subject to clearances. Volkswagen says the purpose is to optimise shareholding structures, and that it remains a significant strategic investor. It had earlier agreed not to exercise voting rights on part of its holding; the sale will not reduce the voting rights the Group exercises, and its board representation and nomination rights are unaffected.

Why LFP, and why in Europe

The release puts LFP at about 10% of the European market today, with a forecast of 40 to 60% by 2030, and says Europe has no relevant LFP cell production capacity at present. PowerCo chief executive Frank Blome said, "Volkswagen and PowerCo are building Europe's battery industry." Thomas Schmall, the Volkswagen board member for Technology and chairman of PowerCo's supervisory board, said, "This marks a major breakthrough for both companies." Gotion chairman Li Zhen spoke of "six years of close collaboration" and of anchoring a shared strategy "to localise battery production in Europe."

The release lists the reasons for choosing LFP as competitive costs and long service life, which make it a key chemistry for affordable volume-segment electric cars.

Five years of cooperation

The companies have worked together since 2020. Gotion supplies cells to the Volkswagen Group and is a strategic partner of PowerCo, which is the Group's battery arm based in Salzgitter. Gotion is headquartered in Hefei, China.

The release gives no start-of-production dates for the three ventures, and no capacities in gigawatt hours or headcounts.

Sources

• Volkswagen Group: Volkswagen Group, PowerCo and Gotion deepen strategic partnership, 28 September 2026